Obama seeking more nuclear energy loan guarantees

May 20, 2010 6:25:00 PM - thestate.com

President Barack Obama is poised to ask Congress to agree to $9 billion more in loan guarantees for the nuclear energy industry, a Democratic aide said Thursday, in a renewed push for nuclear power as the growing oil spill in the Gulf of Mexico highlights the risks of fossil fuel production.

Also Thursday the Energy Department announced a $2 billion loan guarantee for French-owned nuclear services company Areva Inc. to support construction of a uranium enrichment plant in eastern Idaho.

At the insistence of Democratic House Speaker Nancy Pelosi of California, the request for more spending on nuclear energy would be coupled with $9 billion in loan guarantees for renewable energy such as wind and solar, according to the Democratic aide, who spoke on condition of anonymity before a formal announcement from the White House.

The request would be tacked onto a multibillion-dollar spending bill for Afghanistan, Haiti and other programs that Congress is expected to finish after Memorial Day. Taxpayers would have to pay $180 million to support the loan guarantees, essentially putting up insurance for nuclear companies that would have trouble borrowing money to build new plants without the federal backing.

The new spending follows $18.5 billion in nuclear loan guarantees the Obama administration announced in February to spur building of the first nuclear power plant in the U.S. in almost three decades, part of a broad shift to lessen dependence on foreign oil and reduce the use of other fossil fuels blamed for global warming. Obama called for "a new generation of safe, clean nuclear power plants" in his State of the Union speech this year.